Tuesday, May 31, 2011

My family and I had a blast this month at the Tour de Cluck, a peculiarly Davis, California, sort of event. Hundreds of people meet at the Davis Farmer's Market on a Saturday, get on their bikes, and visit a large number of chicken coops that families all over town keep for eggs. From last year's video, you can get a sense of the event, and also of the bicycle culture here, complete with bike lanes and bike paths everywhere.

Davis is bustling with local agricultural experimentation. In April, I enjoyed a presentation by local author Spring Warren, who wrote a book about feeding her family for a year with an urban Quarter-Acre Farm. Since August, we have lived a couple blocks away from the Village Homes, a 70-acre conservation-oriented residential neighborhood, where the streets are named after places in Middle Earth and the neighbors share a lot of space in common, including a garden, chicken coops, and a vineyard.

If gardens and chickens are not enough to inspire you, consider goats. In June, my family will finally get to visit our old friends Tom and Didi, who -- along with their children, friends, dog, and goats -- found a lively and musical way to tell the story of their efforts to get permission to keep goats in Seattle. The following video is on the website of the Goat Justice League. The goats, Rosie and Phyllis, were even featured in an article in the American Bar Association Journal this month.

Wednesday, May 25, 2011

Oxfam America in March released a report analyzing the poverty footprint of beverage giant Coca-Cola and multinational bottling company SABMiller in Zambia and El Salvador. The report was jointly authored by the three organizations.

Marion Nestle gave Oxfam a hard time about this report: "I can only guess that Coca-Cola’s grant to Oxfam must have been substantial." In a comment on Marion's blog, Chris Jochnick from Oxfam explained that Coca-Cola had contributed $400,000 to the research project, and -- separately from this research project -- had given Oxfam $2.5 million in 2008-2010 for humanitarian work.

Altogether, I feel the Oxfam project contributed to the companies' public relations messaging, overstated the companies' beneficial contribution to local economies, under-emphasized the health concerns about their impact, and did not adequately preserve Oxfam's own independence in the cooperative analysis.

Oxfam America is truly my favorite humanitarian assistance organization -- because of sensible economic and policy commentary combined with good works on the ground -- so I hope my blog post on this particular report gets a thoughtful reading from Oxfam staff. In particular, I have no complaint about Oxfam's vision for the private sector role in economic development. Yet, I did not like this report.

Poverty footprint

First, the report appeared to credit the companies with contributing more than $100 million in economic activity to the local economy, generating millions of dollars in tax revenue for local governments and creating many thousands of jobs. However, after reading the report closely and asking Oxfam staff some questions about it, I think readers should be careful not to think of those dollars and jobs as a real impact of Coca-Cola's presence.

The report itself has a bold statement of its analytic goals:

Oxfam is developing the Poverty Footprint Methodology as a means to understand the full range of impacts multinational corporations have on poor communities, and to provide a platform for engagement around those impacts.

The report's most important quantitative results imply the companies have a large and beneficial macroeconomic impact:

An examination of the Coca-Cola/SABMiller value chain’s macroeconomic impacts reveals that its Gross Value Added (GVA) in 2008 was approximately $21 million in Zambia and $83 million in El Salvador. In addition, the Coca-Cola/SABMiller value chain supported an estimate of more than 3,741 formal and informal jobs in Zambia and 4,244 formal jobs in El Salvador.

However, these numbers are not a correct estimate of the companies' "footprint" or impact on local economic activity, tax collections, and jobs. If Coca-Cola did not exist, or were not allowed into Zambia and El Salvador, two things would be different from the current situation: (a) other beverage companies, including local companies, would sell more product, and (b) other beverages, including traditional beverages and water, would provide a larger share of the consumer's hydration needs.

If other beverage companies took up the slack, much of the economic activity and tax payments and job creation would have happened anyway. It would be interesting to know how much profit Coca-Cola takes out of the local economy and returns to international shareholders in the United States and Europe. At times, the Oxfam report appeared to be addressing the issue, but it didn't really. Buried deep in the report, footnote 22 on p. 84 acknowledged: "The Coca-Cola Company’s profit information was not shared with the research team."

I asked Oxfam if the analysis compared the situation with Coca-Cola to a situation without Coca-Cola, which is the relevant comparison for assessing "impact." Helen Dasilva of Oxfam replied, "The objective was not to compare an economy with the system to an economy without." The result is to give the companies credit for big dollar impacts that overstate their real contribution to job creation and the economy. This is an analytic approach that one commonly sees when a county or State or industry boasts about the importance of its local economic activity, but this is not an approach that an independent analysis should take in assessing a multinational company's impact in a developing country.

Sugar-sweetened beverages and obesity

Second, the report included no critical discussion of expanded consumption of sugar sweetened beverages, displacement of traditional foods and beverages in the diet, and rising rates of overweight and obesity in developing countries.

When I asked Oxfam about this, Dasilva responded:

The focus of this project was not to study or address the issues surrounding obesity, nor did we conduct an analysis of the impact of Coca-Cola products on overall nutrition or health. That was a result of our limited bandwidth.

Dasilva agreed to forward some of my questions to Coca-Cola, which would not answer specific questions about the growth of sales of sugar-sweetened beverages in Zambia and El Salvador. In particular, because a large fraction of the population in developing countries is children, I asked about growth in sales to children. Coca-Cola's answer was clever:

We have a global Responsible Marketing Policy that covers all our beverages, and we do not market any products directly to children under 12. This means we will not buy advertising directly targeted at audiences that are more than 35% children under 12. Our policy applies to television, radio, and print, and, where data is available, to the Internet and mobile phones. Because of this policy we do not track sales to children under age 12 as it is against our global policy to directly target this age group with any marketing for our beverages.

I think of the advertising policy as a secondary issue. The real question is how much full-sugar Coke is the company selling to children. I don't believe a policy about advertising is sufficient reason to dodge a question that was not about advertising, but rather was about sales. This is a tough question that Oxfam should have asked Coke but didn't.

Oxfam's independence from Coca-Cola messaging

Third, because of the joint authorship, it is impossible to tell what parts of the report are Coca-Cola writing, and what parts are Oxfam writing.

I asked Oxfam if this joint authorship caused the organization to make compromises in the language it would have used in a report that it authored independently. Dasilva responded:

Bringing two significant multinationals and a global development organization together to agree on language in any report will be challenging. This report was no different and the result isn’t perfect. While it is safe to assume our varied cultures, missions and ways of working led to differences of opinion, it would be tough to pinpoint specific language differences given how many comments from all sides went into the final document.

I appreciate Dasilva's frank answer. An Oxfam-authored report would have been quite different from this jointly authored report. I look forward to reading the Oxfam-authored version some day.

Wednesday, May 18, 2011

In a speech today on the UC Davis campus, Kathleen Merrigan gave a fascinating tour of USDA's bustling and diverse work on local food, healthy food, direct marketing, and rejuvenation of U.S. farming. Some of this work is collected on the USDA website under the heading, Know Your Farmer, Know Your Food.

Merrigan is the current Deputy Secretary of Agriculture and a former faculty colleague at the Friedman School of Nutrition Science and Policy at Tufts.

She has a true gift for talking about profound social and environmental principles in an accessible and persuasive way. Although many farmers (and many agricultural economists) get nervous about overly fanatical locavorism, Merrigan is a sort of antidote for everything that divides us. She makes a compellingly pro-farmer argument for local and sustainable food production. At a time when many urbanites are suspicious of USDA, and sometimes even suspicious of the farming community, Merrigan makes both look good. I hope farmers across the country get to hear her speak.

Merrigan's speech today was sponsored by the Agricultural Sustainability Institute at UC Davis. She presented the first Eric Bradford and Charlie Rominger Agricultural Sustainability Leadership Award to a graduate student here.

Friday, May 13, 2011

Each year, USDA's Pesticide Data Program publishes data on pesticide residues, principally in fruit and vegetable crops, selected in part because of their frequent consumption by children. It is difficult to know how worried consumers should be about the results. Here are some thoughts and questions on the most recent 2008 residue detections for fruits and vegetables.

For some pesticides, EPA sets safety tolerances for the maximum amount of residue that should show up on food. For other pesticides, EPA sets no tolerance, meaning that there should not be any residue of that pesticide at all.

First, we look at data on total residue detections. Many fruit and vegetable samples have multiple pesticide residues, but the amounts may be small, usually far within the Environmental Protection Agency's safety tolerances. Let's say for the moment that we are not very worried about these total detections, but instead want to know about detections that violate EPA standards.

All samples

Residue detections

#

#

per 100 samples

Asparagus

372

39

10.5

Blueberries

726

1736

239.1

Broccoli

554

797

143.9

Celery

741

3821

515.7

Green Beans

741

1392

187.9

Green Onions

186

272

146.2

Greens, Collard

240

540

225.0

Greens, Kale

318

622

195.6

Nectarines

672

1603

238.5

Peaches

616

2155

349.8

Potatoes

744

1410

189.5

Spinach

747

1850

247.7

Strawberries

741

3703

499.7

Summer Squash

554

1050

189.5

Sweet Corn, Fresh

152

1

0.7

Sweet Potatoes

184

92

50.0

Tomatoes

740

903

122.0

Total

9028

21986

243.5

Second, therefore, we look at residue detections that exceed EPA's established tolerances, for pesticide uses that have a tolerance. These detections are more worrisome when they happen, but they do not happen very frequently. Fewer than 1% of samples had this type of residue detection exceeding an established tolerance.

All samples

Residue detections exceeding an established tolerance

#

#

per 100 samples

Asparagus

372

0

0.0

Blueberries

726

3

0.4

Broccoli

554

0

0.0

Celery

741

2

0.3

Green Beans

741

2

0.3

Green Onions

186

0

0.0

Greens, Collard

240

11

4.6

Greens, Kale

318

10

3.1

Nectarines

672

0

0.0

Peaches

616

0

0.0

Potatoes

744

7

0.9

Spinach

747

16

2.1

Strawberries

741

2

0.3

Summer Squash

554

5

0.9

Sweet Corn, Fresh

152

1

0.7

Sweet Potatoes

184

0

0.0

Tomatoes

740

1

0.1

Total

9028

60

0.7

Third, we look at residue detections for pesticides that have no EPA tolerance. The lack of a tolerance may mean that the chemical is judged to be of greater safety concern. The USDA found many such residue detections -- almost 5 such residue detections per 100 samples, which seems like a lot of detections in violation of EPA standards. However, the tests are quite sensitive, and the residue amounts may be very small. USDA is not greatly worried: "In most cases, these residues were detected at very low levels and some residues may have resulted from spray drift or crop rotations."

All samples

Residue detections for pesticides with no tolerance

#

#

per 100 samples

Asparagus

372

1

0.3

Blueberries

726

21

2.9

Broccoli

554

17

3.1

Celery

741

123

16.6

Green Beans

741

23

3.1

Green Onions

186

9

4.8

Greens, Collard

240

34

14.2

Greens, Kale

318

45

14.2

Nectarines

672

2

0.3

Peaches

616

61

9.9

Potatoes

744

45

6.0

Spinach

747

33

4.4

Strawberries

741

5

0.7

Summer Squash

554

15

2.7

Sweet Corn, Fresh

152

1

0.7

Sweet Potatoes

184

1

0.5

Tomatoes

740

1

0.1

Total

9028

437

4.8

Environmental groups are not convinced. The Environmental Working Group uses these data as one of several sources in constructing its "dirty dozen" and "clean fifteen" lists of fruits and vegetables.

I wish the USDA's PDP reports did a better job helping readers to understand the implications of residue detections for pesticides that have no EPA tolerance. If USDA's position is that these are negligible detections, attributable to inconsequential pesticide drift, then it should explicitly set a threshold for these negligible detections. On the face of it, without that type of interpretation, I am reluctant to accept that these detections are all inconsequential. For example, notice that 16% of celery samples and 14% of many leafy greens had this type of violation. Could those really all be spray drift? That would seem surprising. It would help to have a more blunt assessment from USDA experts: "These detections are negligible, but we want these other detections to fall into compliance in the near future."

Also, the Environmental Working Group throws a good heavy punch this week regarding the produce industry's government-funded information campaign to convince people not to worry about pesticides. Agriculture departments, including the California Department of Food and Agriculture and USDA, should steer clear of anything that smacks of misleading propaganda on this topic. For example, now that I have had time to study the residue data, I suspect last November's report from the Alliance for Food and Farming is overconfident that these residues are harmless. A better approach might be to undertake some vigorous enforcement, drive down the frequency of violative residue detections, and then boast about the results. Indeed, if industry leaders took a long-term perspective, I think they would encourage USDA to do so.

Pesticide residues are not my leading food safety concern -- they rank behind foodborne illness on my list of things to worry about -- but I do take them seriously. Among agricultural economists, I sometimes hear an outright dismissal of concern about pesticide residues as completely silly, but I think scientists who study cancer risks and toxicity take these concerns more seriously. For example, here are the conclusions of the 2008-2009 report from the President's Cancer Panel, issued by the federal government's National Cancer Institute:

The entire U.S. population is exposed on a daily basis to numerous agricultural chemicals. Many of these chemicals are known or suspected of having either carcinogenic or endocrine-disrupting properties.

Wednesday, May 04, 2011

Food safety depends on both market incentives and government regulation. If consumers and intermediaries (such as supermarkets) knew more about the safety of different food categories and food producers, they would be better able to defend their own interests in the marketplace. Without such information, strong government oversight is essential.

This blog post is about two kinds of food safety information: the first has recently been in the news, and I think the second has not been covered much in the news.

Recent research on food safety priorities

First, the Emerging Pathogens Institute last week released estimates of the Top 10 riskiest food/pathogen combinations. The riskiest food category was poultry, with annual estimated costs of $2.46 billion and 180 deaths. The riskiest food/pathogen combination was campylobacter in poultry, with annual costs of $1.26 billion and 55 deaths. Salmonella in poultry had annual costs of $0.71 billion and 81 deaths.

The Institute discussed implications for the USDA's Food Safety Inspection Service (FSIS) and the Food and Drug Administration (FDA):

Salmonella causes more disease burden than any other foodborne pathogen, and according to FoodNet surveillance data, is one of the few foodborne pathogens that has not significantly declined over the past 10 years.... Our analysis also shows Salmonella disease burden as being associated with a wide variety of foods regulated by both FSIS and FDA, with significant risks associated with poultry, produce and eggs. This suggests that reduction of the national burden of salmonellosis will require a coordinated effort by both agencies addressing a broad array of foods. We recommend the agencies convene a national cross-agency initiative in collaboration with CDC that looks across the entire food system to target opportunities for risk reduction.

FSIS data on salmonella in particular food plants

In recent years, FSIS has begun to make public information about particular poultry plants where random samples tested positive for salmonella. I am still learning to read and interpret these reports. I think the major media may be having similar difficulties, because I do not know that these reports get any media coverage.

FSIS provides three categories: Category 1 is good, Category 2 is intermediate, and Category 3 is the worst category (for poultry plants that failed at least one recent test and did not do very well on a second test either).

For example, in the most recent report on Category 3 establishments (.pdf), the Tyson Foods plant in Temperanceville, VA, nearly failed one test (more than 10% of samples had salmonella) and then failed a second test (more than 20% of samples had salmonella). In 2010, according to the most recent FSIS annual progress report, only 5 plants out of 172 did poorly enough to fall into this Category 3 status, so clearly most poultry plants find the FSIS criteria to be a reasonable standard to achieve.

Economists see many food safety problems as a type of information failure. If consumers and institutional buyers only had good information, market incentives would solve many food safety problems. So, I find these FSIS reports intriguing, but I see them as a promising work in progress.

Can anybody tell me if I interpreted the reports correctly? Has there been any media coverage at all of these reports? What would it take to make this type of information a major factor in food safety improvement?

Update May 9, 2011: First, USDA's Food Safety and Inspection Service (FSIS) has just this year updated the Salmonella standards discussed in this blog post and established new standards in the same spirit for another pathogen, Campylobacter. Second, a 2009 report from USDA's Economic Research Service suggests that better information sharing could lead to stronger market incentives for food safety protection:

The forces driving management-determined actions lead to the conclusion that USDA’s FSIS could increase incentives by providing consumers and buyers with more information about the meat and poultry food safety control of particular plants and fi rms. USDA’s FSIS records plant performance on Salmonella spp. tests and noncompliance with process regulations. Making this information public should encourage greater food safety investments by meat and poultry producers.

Tuesday, May 03, 2011

As you travel through the food producing regions of the United States, every farm and food manufacturing business has its own story. Yet, in the most intensive food producing regions of California, some of these stories seem to have a particularly epic scale, appropriate to the setting.

The story of Joseph Gallo Farms is like a bottled up distillation of every manner of U.S. food policy issue.

The other week, while visiting the Salinas Valley to learn about the environmental challenges of concentrated animal agriculture in close proximity to large-scale vegetable production, I took these roadside photographs of one of the large-scale Joseph Gallo Farms dairies.

You may ask, why does this dairy company not produce "Joseph Gallo Farms" cheeses? Why drop the last name? Well, now, there indeed is a story.

Joseph Gallo was the younger sibling of Ernest and Julio Gallo, who founded the largest exporter of California wines and one of the wine industry's most famous brands. To protect the wine brand, Ernest and Julio successfully sued their younger brother to prevent him from using the Gallo name on cheeses at the retail level.

The judge who authored the 1992 court decision clearly got caught up in the operatic narrative and let loose his inner novelist. Here is just one early section. If this blog post were a movie, the screen would fade on the current decade and you would see an antique automobile puttering along a dusty dirt California road in the early 1900s.

This lawsuit arises out of a tortuous family history apparently involving sibling rivalry on a grand scale. Because Joseph's counterclaims concern his parents' estates, the relevant facts date back nearly a century.

I. The Rise of the Gallo Family, the Establishment of the Winery, and Ernest and Julio's Guardianship of Joseph

The individual parties to the action, Ernest, Julio, and Joseph, are the children of Joseph Gallo ("Joseph Sr.") and Assunto ("Susie") Bianco, immigrants to Northern California from Italy in the early 1900s. Joseph Sr. and Susie married in 1908. Ernest was born in 1909, Julio in 1910, and Joseph in 1919. Following their marriage until the advent of Prohibition in 1919, Joseph Sr. and Susie operated various boarding-houses and saloons, in connection with which they served and sold wine purchased from other California wine dealers. Evidently they stenciled the family name GALLO on the ends of the wine kegs, although they did not make the wine themselves. Throughout the 1920's, the family purchased a series of vineyards, where they grew their own wine grapes, bought wine grapes from other local growers, and shipped the grapes to the midwest and the east coast, where customers made wine with them for their home use under an exception to Prohibition. Ernest and Julio became involved in this shipping business during the mid- to late-1920s. While Joseph Sr. did have a brush with the law for bootlegging during Prohibition, there is no other evidence that he and Susie sold wine after 1919.

The Great Depression caused the grape business to suffer. Prices dropped; the 1932 season was a financial disaster for Joseph Sr. and Susie. On June 21, 1933, Joseph Sr. took Susie's life and his own.

The court decision goes on to recount that Joseph was raised by his brothers as guardians, his part of the inheritance was used as an early source of capital for Gallo Wines, he sued his brothers and was repaid, and, many years later, they prevented him from using his full name as the brand name for his cheeses.

A layperson may be astonished that Joseph Gallo could not use his own real name as his brand. But, several key features of this particular dispute favored the older brothers. The Gallo wine brand is a "strong" and widely known brand. Because wine and cheese are consumed together, and it is plausible that a wine company could sell cheese, a consumer might really be confused about the connection between the cheese brand and the wine company. Consumer research showed that a written label disclaimer did not suffice to clear up the confusion.

If you buy Joseph Farms California Natural Cheeses in your grocery score, there is more history to that food label than you might otherwise know.